Drilling in the Arctic - what is the environmental impact?

Greenpeace activists have been charged with piracy for their protest on a Gazprom oil rig. But what are they protesting about and what is the justification for their claims? With your help, Karl Mathiesen investigates. Post your views below, email
karl.mathiesen.freelance@guardian.co.uk or tweet
@karlmathiesen.

What are the risks of drilling for oil and gas in the Arctic? AP/Greenpeace/Steve Morgan

6.45pm BST

My verdict

Greenpeace's assertion that the drilling industry is unprepared, in fact unable, to clean up a major Arctic oil spill is resoundingly seconded by scientists. We do not have the technology, nor the infrastructure, to deal with the specific challenges of a disaster in this region.

But Arctic oil extraction is in no way a new thing. Statoil has been operating in ice-free areas of the Arctic circle for 20 years. This means the industry has developed certain technologies which help it to avert accidents. It also means that there are places in the Arctic that are safer to drill than others.

Oil exploration in the north is driven by the demands of the market. But the market is sending mixed messages. On one hand are high costs, questions over technology, competition from other energy resources and geopolitical uncertainty. On the other hand is the world's insatiable hunger for energy. These combine to make Arctic oil a mercurial economic proposal. Although countries like Russia have more to gain in the region than others.

A key point is that controlling the Arctic future and ensuring good practice will require transparency on the part of drillers. A questionable prospect with companies such as Gazprom and Rosneft. The adversarial actions of Greenpeace could have two opposing effects. They may force accountability on oil companies, but they may also serve to drive them further into the dark.

On a slightly different note, many of the comments today have focussed on the piracy charges against the Greenpeace protesters rather than the question of the audit. This raises a question about whether the civil liberties case of the activists has obscured the environmental message.

Today's resounding (and scary) scientific consensus is that an oil spill in the Arctic is inevitable if drilling progresses. If this is so, shouldn't we support research into safer practices? Or should we simply be pulling out of the region altogether.

How we clean up an oil spill is a very different issue to how we supply the energy demands of the future. But in the Arctic these two questions collide. Climate change, contributed to by fossil fuel emissions, opens up new regions for the extraction of more fossil fuels. It's a catch-22 that can only be solved by a halt to drilling. Greenpeace have obviously become an effective thorn in the side of big Arctic oil. But realpolitik and the market may well decide the future of the north, rather than a protest movement.

Updated at 7.32am BST

5.45pm BST

For the record

I approached Shell, BP and Cairn Energy about their past operations and future plans in the Arctic. All of them declined to comment saying they were not currently drilling in the region.

5.38pm BST

From the environmental audit committee

Parliamentary green watchdog, the environmental audit committee, produced a report last year on the impact of climate change on the Arctic and the safety of oil and gas drilling in the region.

The committee said:

It [the report] concluded that the lack of proven oil spill response techniques makes exploring for new reserves in the extreme Arctic environment needlessly risky. The MPs also pointed out that the world already has more proven oil and gas reserves than can be burnt without exceeding a global average temperature rise of 2 degrees – widely regarded as a dangerous threshold.

The report called for a moratorium on Arctic oil and gas drilling, and challenged the UK government – which supports drilling by UK companies like Shell in the Arctic - to set out how future Arctic oil and gas extraction could be reconciled with its commitment to limit global temperature increases to below 2C.

Joan Walley, chair of the committee, said:

“Protecting the Arctic should automatically be high on the political agenda. It should not be left to peaceful protesters to insist that risks from oil exploitation in this fragile environment be urgently addressed.

“There should be informed international dialogue and action and I hope our report and follow up to it can be part of the process for tackling the threats that the Greenpeace protesters have so graphically exposed.”

“The government has sadly not been very receptive to our recommendations, but did at least acknowledge the need for an Arctic strategy cutting across the remits of all relevant government departments. We will be scrutinising that policy framework carefully when it is produced.”

Updated at 5.49pm BST

5.33pm BST

More scientific reaction

"... drilling in the Arctic varies so very greatly depending on where you are talking about e.g. Northern Norway is very different to say Alaska. Offshore drilling is less well developed compared to onshore. And places like the Hibernia development is arguably more challenging in the sub-Arctic than parts of the so-called blue Arctic north of Scandinavia ... so geography matters.

"My own view is that the environmental impact needs to be juxtaposed with social-cultural impact as well as possible benefits. In Greenland, opinion is divided and one thing to be clear on is that northern communities are not always opposed to resource extraction. The issue is sharing and consultation as well as regulation."

Dr Simon Boxall from the University of Southampton says that, at present, Arctic drilling does not have the technology to clean up a spill.

"Companies will say that it won't happen, we've got so many fail-safes these days that it's a perfectly safe operation. But there's no such thing as a fail-safe. If there was a a fail-safe, we wouldn't have planes crashing... Human error and humans cutting corners means that accidents happen. And there will be a spill in the Arctic. And as with the Gulf of Mexico it'll probably be fumbling in the dark a bit, dealing with it as it happens."

"The environment in the tropics and certainly in the Gulf of Mexico is such that nature kicks in and it deals with oil that gets spilt in the tropics very efficiently. Even in fairly temperate climates, bacteria take over and they clean up what we leave behind. Now in the Arctic things are very different. In the Arctic it's much much colder first of all, which means that the whole process takes much longer. So we have a problem, the fact that we are putting our oil in the fridge and that keeps it in its natural state.

"Problem number two is the spill, when it happens, whether it's from a tanker, whether it's from a drill operation if it's close to the ice edge, will go under the ice and we have no research and no experience with a spill that goes under ice.

"Problem number three is that we are working in a remote part of the world. In the Gulf of Mexico we are close to big international airports, we can get big heavy equipment in. There are ships sitting there, there's big industry there. There are small ships ready to deal with clean up and that sort of thing. That infrastructure doesn't exist in the Arctic."

Boxall says that the issue is complicated by the need to find new reserves of oil:

"There are lots of unknowns in terms of what happens. So scientifically, I suppose, our role is to say, what are the problems? What are the solutions? The problems are oil won't break down quickly, it will be diffuclt to tackle and we don't have models and detailed methodology for dealing with oil in that kind of climate. What are the positives? There's lots of oil up there. So it's a balance between are we ready to go oil free yet as a society? And the answer is no. Personally, I'm not a great fan of exploring the Arctic but I can see that there is an imperative almost that if we don't start exploring less suitable places then we are going to run out of oil."

Updated at 5.34pm BST

4.48pm BST

"I have read nothing that makes me feel this issue is properly understood"

Today he writes of the need for transparency from exploration companies:

The oil industry is looking down a telescope from the wrong end. To them the Arctic area is just another geological prospect to be looked at like any other. Big Oil has been spurred on by US Geological Surveyors who claim a quarter of the recoverable hydrocarbon reserves may lie there.

But the far north is a special area - one of the world’s last pieces of wilderness - and should be recognised as such: a priceless environmental gem, like Antarctica which is guarded by international treaty.

Much of the Arctic is untouched by human footprint and there is an array of unique animal species which live there and are already in danger. The fact that it is one of the places in the world that is most exposed to climate change makes it ironic, if nothing else, that the oil industry is determined to extract more fossil fuels there.

Drilling for oil is a messy business at the best of times. Look at pictures of the early days of Baku to see what impact it can have on the environment, or more recently of course the beaches off the Gulf of Mexico.

BP was able to call upon dozens of marine craft to help with the Macondo blowout at short notice. Obtaining the same kind of support would have been much harder had there been an oil spill off Greenland when Cairn Energy was drilling there.

There are all sorts of special problems that arise with working in the Arctic, not least the exact impact of a crude spill in ice conditions. I have read nothing that makes me feel this issue is properly understood.

Equally Cairn and the Greenland government both seemed queasy about releasing details in public of oil spill plans. That secrecy gets to the heart of the problems in the far north today.

The littoral states that surround the Arctic Ocean would like the rest of the world to leave them alone to explore for oil, iron ore or just tourist opportunities, none more so than Russia where the government expects to get its own way on most things and does not recognise any right to scrutiny by outside interests, certainly not environmentalists.

But if the Arctic is to be left purely to the control of the surrounding countries then they owe the rest of the world one thing at least: transparency. In the absence of this we need someone to act boldly as our eyes and ears: if not Greenpeace then who?

Updated at 5.19pm BST

4.39pm BST

Scientific reaction

Professor Rick Steiner from Oasis Earth Sustainability Consultancy wrote this assessment of what he says are the inherent and unavoidable risks of Arctic exploration. I highly recommend a full read of the document as Steiner goes to the heart of today's Eco Audit question.

"Put simply oil drilling in the Arctic Ocean cannot be done safely – there will be chronic degradation, there will be spills. So the policy question is whether we wish to expose the Arctic Ocean and its people to such risk.

"And, perhaps a larger issue is that all of the carbon produced from the Arctic seabed will ultimately be emitted into the global atmosphere and oceans, further compounding climate change that is already devastating the Arctic ecosystem."

3.56pm BST

Reaction from NGOs

Louise Rouse from NGO ShareAction says there are many examples of the oil industry's unpreparedness to move into the challenging Arctic region:

In the case of Russian Arctic projects, the risks that Shell – one of the most advanced and experienced oil companies in the world – could not successfully navigate are compounded by a lack of relevant experience by the two Russian companies with exclusive rights to drill in the Russian Arctic and with whom international oil companies like Shell are entering into alliances – Rosneft and Gazprom.

Arctic oil and gas exploration presents new and unique challenges to the oil industry. These challenges are compounded in the Russian Arctic by Gazprom and Rosneft’s lack of experience of offshore projects at senior level, poor environmental and health and safety track records, a lack of transparency in company reporting and questionable corporate practices at board level. These unpredictable and risky corporate practices are compounded by a complex political regime that is currently divided over the future of the Russian energy sector. In this context, the rush to gain access to the Russian Arctic seas through JVs with and/or share acquisitions in Russian oil and gas giants, Gazprom and Rosneft, is worthy of investor scrutiny.

To illustrate this lack of experience:

Rosneft:

Has never brought an offshore project to extraction stage as operator.

Responsible for 2,727 or 75% of spills in Russia’s largest oil province Yugra in 2011 while extracting only 25% of the total regional output that year.

The Kolskaya rig sank, killing 53 of its 67 crew after Gazprom’s subsidiary Gazflot continued drilling outside of the approved season and without carrying out all necessary assessments

No member of the board of directors has specific offshore experience or with special responsibility for offshore projects

Has taken no steps to address the lack of offshore drilling expertise or oversight at board level.

Gazprom’s headline Arctic JV with Total and Statoil, which was to operate the massive Shtokman field in the Barents Sea, fell apart in 2012 after years of delays, a cost rise from $20bn to $40bn and lack of clarity over fiscal conditions made extraction economically unfeasible.

3.51pm BST

A oil rush?

One of the major narratives the green movement has been propagating is that of an oil and gas rush with irresponsible companies storming north trying to beat one another to tap newly available reserves.

But an article by Paul Betts in Oil Magazine suggests otherwise. "After a period of "irrational exuberance," the pace in the Arctic is slowing. In the last year; Royal Dutch Shell, BP and Statoil have stopped drilling, and Gazprom has suspended the Shtokman project," he says.

Betts says the industry may have gotten ahead of itself in its excitement at new opportunities presented by retreating sea ice. He said it was clear that the industry had become "increasingly skeptical about the ability of oil companies - at least for now - to drill, extract and ship the oil and gas safely in the extreme weather and sea conditions of this remote region".

The enormous costs of developing new technologies was a deterrent to investment he said. As well as embarrassing incidents such as the grounding of a Shell rig in January 2013, which highlighted the difficulty of operating in the storm torn seas of the north.

Betts says these costs, when combined with low oil prices and competition from new energy resources like coal-seam gas and LNG, mean that the Arctic region has become less enticing for oil companies.

A report by consultancy firm Ernst and Young said Arctic exploration is "not for the faint of heart, nor for those with less than deep pockets".

Betts says extra pressure is being applied to companies by uncertainty over the geopolitics of the Arctic. Russia is one of the key drivers of Arctic exploration. Oil and gas resources in the region are key to Russia's geopolitical strategy and energy security. "Russia, however, is also fully aware that it cannot do this by itself and that the development of the oil and gas sector, particularly offshore, depends to some extent of the participation and cooperation of Western oil companies," says Betts.

3.20pm BST

Reaction from drilling industry

Statoil spokesperson Bård Glad Pedersen says the Norwegian oil and gas company is exploring the Arctic through a step-by-step approach that builds on decades of experience in cold water regions.

"Statoil have taken a step-wise approach to the Arctic. A prerequisite to any activity or any drilling is that we are able to do it safely and responsibly. We have 20 years experience from the Norwegian Barents Sea in ice free areas. We have around 90 wells and also made large discoveries. Currently we are drilling in ice free areas or ice free periods of the year.

"I think this step-wise approach where you develop competence. experience and technology to take on new challenges going forward is the right approach to have. We will not move faster into the Arctic than technology allows us to make sure than we are able to do it safely."

He says different Arctic regions offer different challenges to drilling companies:

"It is important to understand that there are different areas within the Arctic that present different challenges. A substantial part of the Arctic is ice-free. But it could be areas which are dark, remote and maybe you could have icing of equipment so you need to take those challenges seriously. I think we are able to do that.

"Where there's no ice you need to have heating equipment and insulation to avoid freezing on the rigs. On the east coast of Canada, where we recently made a large oil discovery, you need to have a system to manage icebergs who occasionally drift by. We have ships in place to tow them on to different routes. In this area there has been oil and gas activity for years and you have these systems developed."

On the activities of other Arctic exploration companies, he said: "I think there is a general understanding of the challenges in the Arctic and the need to develop technology and competence."

2.27pm BST

The great hope of the energy industry

Oil Magazine, an energy industry quarterly, devoted the whole of its March 2013 issue to Arctic energy exploration. Disappearing Arctic sea ice is seen as a huge opportunity for an energy industry seeking new reserves of fossil fuels. "20% of the world's unexplored gas and oil potential lies in the Arctic," says Oil.

"The new frontier of energy procurement runs along the Arctic Circle," says editor-in-chief, Gianni di Giovanni.

Economist Geminello Alvi writes: "With the melting of the ice, this most inhospitable of areas might one day be green again, and even inhabited, as in the myths about the Hyperboreans."

It is clear from reading Oil that the energy industry sees an exciting future beneath the Arctic seas. But Oil journalist Moisés Naím says: "Critical environmental, technological, political and institutional questions remain unanswered."

Naím says the impacts of climate change have led to inevitable interest from oil and gas companies as the retreating sea ice exposes large, untapped resources: "The trend, then is for climate change to make the region more accessible, bolstering the attraction to the Arctic's wealth of oil, gas, and mineral supplies."

But Naím says the cost implications should mean exploration is cautious and mindful of the delicate Arctic environment: "Limiting the costs and damages associated with industrial development, climate change, pollution, natural resource extraction, and disturbance to the precious ecosystem must be prioritized and monitored with great attention."

Naím identifies two extreme futures for the Arctic. An anarchic, exploitative future where poor governance, activism and pollution are rife and a sustainable, harmonious future in which governments, energy companies and NGOs cooperate to decide on best practice exploration. He admits that the second alternative seems utopian.

Updated at 2.35pm BST

1.32pm BST

The key arguments put forward by Greenpeace

Greenpeace identifies two distinct threats posed by drilling in the Arctic. One is the immediate threat of an oil spill. Greenpeace claims oil companies do not have appropriate risk mitigation against this kind of accident.

The indirect threat to the Arctic ecosystem posed by climate change and the fossil fuel industry's contribution to carbon emissions is the underpinning motivation for Greenpeace's actions. Diminishing Arctic sea ice poses a direct threat to the Arctic's biodiversity and eventually to the planet, say Greenpeace.

Their website says Arctic oil exploration is being assisted by the melting ice:

The fragile Arctic is under threat from both climate change and oil drilling. As climate change melts the Arctic ice, oil companies are moving in to extract more of the fossil fuels that caused the melt in the first place. But above the Arctic circle, freezing temperatures, a narrow drilling window and a remote location mean that an oil spill would be almost impossible to deal with. It's a catastrophe waiting to happen. Greenpeace is working to halt climate change and to stop this new oil rush at the top of the world.

Shell has been a particular target of Greenpeace. To examine some of Greenpeace's claims against the Dutch and British-owned company you can read a list of their charges against them. Mostly Greenpeace says it is concerned about the company's unpreparedness to contain any accident.

"The Arctic is the air conditioner and the refrigerator of the planet and what happens here affect all of us," says Kumi Naidoo in this interview with Bill Moyers.

Updated at 2.36pm BST

12.46pm BST

Welcome to the eco audit

Russia today charged Greenpeace activists with piracy for their protest action on a Gazprom oil rig in the Arctic Circle. Russia's police action and the potential for draconian punishments (piracy carries a maximum sentence of 15 years in Russia) is "the most serious threat to Greenpeace's peaceful environmental activism" since the sinking of the Rainbow Warrior, according to Greenpeace executive director, Kumi Naidoo.

Apart from Greenpeace's right to protest, what is at stake in the Arctic? And why is Greenpeace so concerned about Arctic drilling in particular?

Today I will be talking to experts, industry and scientists about the potential environmental impacts of an Arctic energy rush.

You too can help with the investigation. Please write your thoughts in the comments below, or tweet me, or email me. If you are quoting figures or studies, please provide a link through to the original source. Later I will return with my own verdict.

Greenpeace activists hold a demonstration against Champions League sponsor Gazprom last night to draw attention to the incarceration of 30 protesters being held by the Russian government. The action delayed the beginning of the game between FC Schalke and Basel FC. Photograph: Fabrice Coffrini/AFP/Getty Images